What is the best sounding Pre/Pro 7.1 channel with analog bypass.

When talking about Y-adapters, you must be very careful.  You can use a Y Adapter to connect your Oppo or source to multiple amps.  However, you must never use a Y adapter to connect multiple sources to the same amp.  The signal will feedback into the second source and fry the output stages of that source.
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That being said, I would say either Krell S1200 variation or a Bryston SP3.  Both have slightly different sounds.  Both have fully discrete Class A audio stages for both input and output  Bryston has excellent bass, but it somewhat laid back in the mids and upper mids.  The Krell will not have as strong/deep bass, but it has excellent resolution and attack - much more exciting in my opinion.  The Krell can sometimes sound a bit bright/thin in some systems.

Hey Erik, he needs HDMI input/outputs.  Otherwise, I may have included P7.  But then again, he's asking for the "absolute best pass-through HT Processor".

I agree with big_greg.  Finding a good sounding processor WITH HDMI for $500 used is going to be very hard.  There's an Anthem D1 that has been upgraded with HDMI on audiogon for $670.  That's likely to be 15 years old.  The Integra DTC-9.8 that big_greg recommends can also be 12 or so years old.  

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for something newer, there's actually a Integra DHC-60.5 on ebay for $350 plus $99 shipping.  They say "barely used", but I wouldn't believe that too much.  But it's cheap and originally retailed for around $1600. 

Interesting suggestion.  The AVM 40 is likely a very excellent contender for sound quality, however it's missing one critical element that would be a deal-breaker in my mind --- the ability to support the new bluray audio formats (DTS-MD and Dolby True HD).  It is also older than the Integra by about 5-8 years.  Kind of like buying an old Krell HTS or Showcase processor.

Actually, that's a pretty good suggestion, if you want a new product.  The Outlaw 975 is very well designed and laid out as far as internal architecture goes.  It runs in the same league as the Emotiva UMC-200 did.  If you were looking at a new product, I would actually suggest the 976 model instead (for $929, which is well within your budget for "new").  It supports balanced XLR outputs and has much better power supply and power supply filtering - plus it supports HDMI 4K for future.
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That being said, I still think that Integra DHC-60.5 would be a better choice.  It has much larger power supply and much better components than the Outlaw (capacitors, transformers, etc.).  It is used, but you would get better sound quality in the end.  The Outlaw is built based on very similar principles to Emotiva -- to build the best design as possible using the cheapest components and sell direct to customer (no retail distribution) to give the best "bang for the buck" for the consumer.  They definitely succeed in that.  But keep in mind that Integra originally retailed for $2k (I just checked) and was highly mass marketed and distributed (which means it's still cheaper for a given performance that the boutique companies such as Bryston or Krell).  Integra DHC-60.5 comes in at 24lbs, where the Outlaw 975 is only 9lbs, the 976 is 12 lbs.